The myth of free trade and neoliberalism, special to "The Mustache of Understanding"

a somewhat lengthy but quite informative article in alternet via truthdig by chalmers johnson, reviewing Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism, by cambridge economist ha-joon chang that, besides debunking neoliberal economic policies and the so-called "washington consensus," excoriates tom friedman...

[The] book is a discursive, well-written account of what [Chang] calls the "Bad Samaritan," "people in the rich countries who preach free markets and free trade to the poor countries in order to capture larger shares of the latter's markets and preempt the emergence of possible competitors. They are saying 'do as we say, not as we did' and act as Bad Samaritans, taking advantage of others who are in trouble."

[...]

[Neoliberal policies include] privatizing state-owned enterprises, maintaining low inflation, shrinking the size of the state bureaucracy, balancing the national budget, liberalizing trade, deregulating foreign investment, making the currency freely convertible, reducing corruption, and privatizing pensions. It is called neoliberalism because of its acceptance of rich-country monopolies over intellectual property rights (patents, copyrights, etc.), the granting to a country's central bank of a monopoly to issue bank notes, and its assertion that political democracy is conducive to economic growth, none of which were parts of classical liberalism.

chang's - and johnson's - bottom line...

[F]ree trade, privatization, and [neoliberal] policies are ahistorical, self-serving economic nonsense...

[...]

It is time to recognize, particularly in the English-language economic press, that a "level playing field" leads to unfair competition when the players are unequal.

i spend a great deal of time outside the united states... i have worked on economic development projects in so-called "emerging economies," principally in former socialist countries, i reside part-time in argentina, i have traveled extensively throughout latin america, eastern and southeastern europe, and i have seen first-hand the devastation wreaked by neoliberal, world bank and imf policies... following those policies, it is virtually impossible for a country's producers and manufacturers to prosper... how could they when transnational corporations flood the national markets with goods and services, establish a country-wide presence, and operate with an economy of scale that home-grown businesses find it impossible to match...

every time i go to shop, i always look at the fine-print on the labels of the items i purchase because i want to see what corporation is behind the product... 9 times out of ten it is a transnational corporation, unilever, nestle, proctor and gamble, pepsico, coca cola, danone, bayer, etc., etc... sure, if the country is a big enough market, those corporations may license local companies to produce their products in-country which is at least somewhat better than importing everything, but the money still largely flows out of the country... and, if the market is small - macedonia, for instance - most brand-name products on store shelves are 100% imported... (and, yes, there are plenty of knock-offs, but that's a whole 'nother story...)

anyone who espouses free trade and neoliberal economic policies is either grossly ignorant of the realities those policies have created in the developing world or committed to serving his or her own economic interests at the expense of others...

Submit To Propeller
Tweet